Ampol (ASX:ALD) share price gains as refinery anticipates best quarter since 2018

The final 3 months of 2021 were good to the Lytton Refinery.

| More on:
a man stands in overalls and a hardhat with a clipboard in front of stacked black oil drums at an oil industry site.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The Ampol share price is currently up 1.44%, trading at $30.98
  • The company announced its Lytton Refinery is set to report its best quarterly performance in more than 4 years
  • Over the final quarter of 2021, the Lytton Refiner Margin was 66% higher than it was in the third quarter.

The Ampol Ltd (ASX: ALD) share price is in the green this morning after the company released a performance update from its Lytton Refinery in Brisbane.

Within it, Ampol announced the refinery – which, only recently, the company was contemplating closing – may have just finished its best quarter in more than 4 years.

At the time of writing, the Ampol share price is $30.98, 1.44% higher than its previous close.

Let’s take a closer look at what the fuel and convenience retailer announced to the market today.

Ampol share price higher on refinery’s quarterly performance

Anticipation of a strong fourth-quarter performance from the Lytton Refinery is boosting the Ampol share price this morning.

The company is expecting the refinery will deliver its highest replacement cost of sales operating profit (RCOP) earnings before interest and tax (EBIT) in more than 4 years for the final quarter of 2021.

According to the company, the result will reflect its “substantial operating leverage to improved refiner margins”.

Though, its strong performance will probably see it walking away without a Fuel Security Service Payment – part of the Fuel Security Package – for the quarter.

Over the quarter ended 31 December 2021, the Lytton Refiner Margin (LRM) was US$11.24 per barrel. That’s significantly higher than the previous quarter’s margin of US$6.76 per barrel.

Additionally, the Singapore Weighted Average Margin (SWAM) rose higher than its 5-year average to reach US$12.79 per barrel. For context, it was just US$7.67 per barrel in the third quarter.

The SWAM was boosted by improved regional refining supply and demand fundamentals.

Finally, production at the refinery strengthened over the quarter. It produced 1,585 megalitres over the quarter. That’s 20 megalitres more than it did in the previous period.

Today’s gains included, the Ampol share price is up 4.28% year to date. It has also gained almost 10% over the last 30 days.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Energy Shares

Pilbara Minerals share price ASX lithium shares A stylised clean energy battery flexes its muscles, indicating a strong lift in share price for ASX energy companies
Energy Shares

Broker names 2 of the best ASX energy share to buy in FY23

These energy shares could be buys for FY 2023...

Read more »

Man in mining or construction uniform sits on the floor with worried look on face
Energy Shares

Why did the Santos share price plunge 10% in June?

Here's what may have weighed on the ASX 200 energy giant last month.

Read more »

Red arrow going down and symbolising a falling share price.
Share Fallers

Why the Paladin share price fell 25% in June

Uranium shares softened in June.

Read more »

A woman sits on sofa pondering a question.
Energy Shares

What happened to the Woodside Energy share price last month?

How did Woodside Energy shares beat the ASX 200 by 16% in June? Let's take a look.

Read more »

sad looking petroleum worker standing next to oil drill
Energy Shares

Why are ASX 200 energy shares dragging on the market today?

Oil prices are likely dragging the ASX 200 energy sector down them them on Friday.

Read more »

oil and gas worker checks phone on site in front of oil and gas equipment
Energy Shares

Santos shares go cold despite energy regulator outlining ‘crucial’ role gas will play for decades

The Australian Energy Market Operator has released a 30-year plan for investment to enable the transition to renewables.

Read more »

An oil worker assesses productivity at an oil rig
Energy Shares

How did ASX energy shares perform in June?

This month has seen some ASX energy giants gain while others tumbled.

Read more »

A surprised man sits at his desk in his study staring at his computer screen with his hands up while he watched the Sezzle share price fall despite the company accepting a takeover offer from Zip Co
Energy Shares

Why is the Woodside share price sliding today?

Oil prices appear to be weighing on ASX energy shares today.

Read more »